What makes LIC shares a good dividend, long term game? Experts decode

LIC IPO Review: Shares of Life Insurance Corporation were listed on Tuesday, May 17, 2022, at around 9% discount on NSE and BSE. 867.20 per share on BSE and Rs 872 per share on NSE on Tuesday.

Meanwhile, despite the silent debut, brokerages and analysts are bullish on shares of India’s largest insurance company in the long run. They believe that strong brand names and India’s higher penetration life insurance space will reciprocate in the long run.

LIC enjoys many competitive advantages such as strong brand pricing, extremely large scale operations, a huge network of agents and a jealous distribution network, says Perth Destiny, founder of Tradingo. Further, the company’s issue is priced at an embedded price of 1.1x, which provides an appraisal facility, he said.

“We encourage investors to stay with the company in the long run, despite the negative listing,” Nati said.

He suggested that those who have applied for enrollment gains can maintain the rupee stop loss. 800. “New investors can take advantage of dips to accumulate these shares in the long run. We would like to add that a lower float post list will limit the company’s downside,” the expert added.

Santosh Meena, head of research at Swastika Investmart Limited, thinks the LIC IPO could be a good dividend.

“LIC did not pay any dividend in the last financial year, so the company may declare a good dividend this year, so it is likely to play a good dividend,” Meena said.

Speaking of the light debut on the exchange, he said that the current market is not conducive to the initial problems and LIC has witnessed a negative listing as the largest IPO.

“Current market volatility has become unbalanced on Insurance Titan’s list. However, the insurance industry in India has good prospects due to the long path of insurance penetration and growth. Therefore, LIC will be the biggest player. Beneficiaries in the long run,” he said. There is no organization that matches 6

According to Binod Nair, head of research at Geojit Financial Services, LIC’s repressed inventory is consistent with expectations in the face of declining market dynamics since the IPO opened.

Listing prices have fallen with the fall in insurance sector valuations, maintaining a discount of about 70% from the industry average, he said.

We believe that LIC’s strong market presence, changes in surplus distribution rules will improve future profits and a decent investment opportunity in the short to medium term considering the growth of the sector, Nair said.

“LIC can perform well if there is a bounce in the market and a positive performance in the insurance sector,” he added.

At around 3.15 pm on Tuesday, LIC shares were trading at about 8% discount on issue price and about 1 percent lower on listing price at Rs 875.00.

Shivam Bajaj, founder and CEO of Avenor Capital, said that despite the reduction in LIC’s pre-IPO valuation, the scrip is still listed on shares at a discount which is consistent with the decline in insurance companies’ valuation and market smoothness. For macroeconomic constraints. “However, due to the interesting fundamentals, stability in the operating metrics and the expected recovery in the market, we may see potential buying interest from investors,” he said.

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